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What is it with indemnity clauses?
Thread poster: Gabriele Demuth

Tom in London
United Kingdom
Local time: 11:28
Member (2008)
Italian to English
Lawyers and insurance Feb 16, 2017

These agreements are what happens when you appoint a lawyer. Lawyers will assume that trust and goodwill are worth nothing. The lawyer will lead you into signing an agreement which, by implication, will also require you to take out "an" (as someone has it) insurance. Stay away from lawyers.

 

Melina Kajander
Finland
English to Finnish
+ ...
* Feb 16, 2017

Kelly Neudorfer wrote:
Translate the dosage instructions for medication, including maybe a table of numbers for ages/weights/mg, and make a typo (3x / daily instead of once, 100mg instead of 10mg, etc.). Someone can die very quickly that way.

It's much less probable if you typically translate marketing brochures, but there are some areas of translation that can have serious consequences if there are errors.

Better stay away from medical translations in that case - a good job I've never done any and probably (especially after this discussion) never will...
My main specialization (subtitling) is reassuringly risk-free in that sense

Although such a typo would surely be spotted in proofreading/checking, before the instructions are printed - and if not, it's not the translator's fault.

Christine Andersen wrote:
Up to a point, yes, translators must be liable for their own actions or negligence, but so are proofreaders and all others involved in the process. It is NOT reasonable to demand that the translator should bear the entire responsibility to everyone remotely concerned.

Exactly.


IanDhu
 

Daryo
United Kingdom
Local time: 11:28
Serbian to English
+ ...
damned if you do, damned if you don't Feb 16, 2017

Tom in London wrote:

These agreements are what happens when you appoint a lawyer. Lawyers will assume that trust and goodwill are worth nothing. The lawyer will lead you into signing an agreement which, by implication, will also require you to take out "an" (as someone has it) insurance. Stay away from lawyers.


Unfortunately, occasionally lawyers can be extremely useful (l'exception qui confirme la règle) so "stay away from lawyers" should rather be "consume in moderation" and "en connaissance de cause" (but then again the unfortunate truth is that the differential in knowledge between lawyers and their clients usually is too big for that)


 

Tom Stevens
United Kingdom
Local time: 11:28
Chinese to English
+ ...
One large UK agency's liability situation Feb 14

This is liability situation of one large UK agency's agreement for freelancers/vendors, which I believe is quite reasonable, and which some translators may consider requesting other agencies to adopt during negotiations.

They have the standard indemnification clauses discussed here "Vendor will indemnify and hold Agency XX harmless from and against any and all claims, damages, losses, demands, costs and liabilities (including all reasonable attorney’s fees) of any kind whatsoever:
... See more
This is liability situation of one large UK agency's agreement for freelancers/vendors, which I believe is quite reasonable, and which some translators may consider requesting other agencies to adopt during negotiations.

They have the standard indemnification clauses discussed here "Vendor will indemnify and hold Agency XX harmless from and against any and all claims, damages, losses, demands, costs and liabilities (including all reasonable attorney’s fees) of any kind whatsoever:" etc.

but they also have a (reasonable, IMO) limitation of liability clause:

"10. Limitation of Liability
Vendor will be liable to Agency XX for any losses
suffered by Agency XX arising out of this Agreement
where such losses are directly attributable to a
breach of contract, breach of statutory duty or to
any negligence of Vendor, its officers or
employees workers or otherwise.
Except as provided otherwise, either party’s
liability under this Agreement shall in aggregate be
the greater of:
(a) In respect of any claim, or series of
connected claims arising out of a specific
P/O, not to exceed 100% of the total value
of fees paid under the P/O; or
(b) In respect of a breach of this Agreement,
not to exceed 100% of the total value of
the fees paid in the preceding twelve (12)
months."

Hope it is useful to some users out there (and apologies for resurrecting this thread from last year)
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Dan Lucas
Eliza Hall
Natasha Ziada
Carolina Finley
IanDhu
Julie Barber
 

Dan Lucas  Identity Verified
United Kingdom
Local time: 11:28
Member (2014)
Japanese to English
No contradiction? Feb 15

Tom Stevens wrote:
They have the standard indemnification clauses discussed here "Vendor will indemnify and hold Agency XX harmless from and against any and all claims, damages, losses, demands, costs and liabilities (including all reasonable attorney’s fees) of any kind whatsoever:" etc.

but they also have a (reasonable, IMO) limitation of liability clause:

Interesting, thank you for this Tom. The question is, which clause takes priority? I would require confidence that the latter clause constrains the former.

Regards,
Dan


Mirko Mainardi
 

Eliza Hall
United States
Local time: 06:28
Member (2018)
French to English
+ ...
Trust and goodwill totally irrelevant here Feb 15

Tom in London wrote:

These agreements are what happens when you appoint a lawyer. Lawyers will assume that trust and goodwill are worth nothing. The lawyer will lead you into signing an agreement which, by implication, will also require you to take out "an" (as someone has it) insurance. Stay away from lawyers.


They're what happens when companies hire lawyers, not when "you" (translators) do. How are trust and goodwill even relevant to this particular situation? Trust in what or whom? No amount of goodwill or trust can change the fact that the interests of translation agencies are in conflict with the interests of translators when it comes to possible lawsuits from a translation client. A lawyer protects their client's interests:

When the translation agency hires a lawyer, the lawyer will say, "Hey, you could get in trouble if your translations cause problems. You've got two ways of fixing that: either get a waiver of such claims from all your clients, or get indemnification clauses from your translators. Or both, that would be the strongest approach."

If you (the translator) hired a lawyer, the lawyer will say, "This is outrageous -- how could you ever pay this, and if this info is so critical it could hurt someone, it should be on them to hire a proofreader. Don't sign it. Or if you want to sign it because you need the work, get really good insurance."

...and the two lawyers are saying different things because their clients have conflicting interests. What could trust and goodwill do to solve that problem?


Dan Lucas
Daryo
 

Rowan Morrell  Identity Verified
New Zealand
Local time: 00:28
Member (2003)
French to English
+ ...
SCARY Indemnity Clause May 8

A client that I only do sporadic work for has sent an updated NDA that they require all their vendors to sign. If vendors don't sign by next Monday, they will "seize [sic] collaboration" immediately. It includes the following absolutely terrifying indemnity clause (obviously, I'll omit the name of the company where that is mentioned):

"The Vendor bears responsibility for any breach of this Agreement for which the Vendor is responsible. The Vendor shall indemnify XYZ and third partie
... See more
A client that I only do sporadic work for has sent an updated NDA that they require all their vendors to sign. If vendors don't sign by next Monday, they will "seize [sic] collaboration" immediately. It includes the following absolutely terrifying indemnity clause (obviously, I'll omit the name of the company where that is mentioned):

"The Vendor bears responsibility for any breach of this Agreement for which the Vendor is responsible. The Vendor shall indemnify XYZ and third parties from all claims resulting from any breach of this Agreement. In the event of a breach of this Agreement, the Vendor shall pay a contractual penalty to XYZ of EUR 5,001.00 for each individual breach of this Agreement by the Vendor or any of the Vendor’s representatives. The Vendor hereby waives the plea of continued offence. Any claims for further compensation for damages remain unaffected by any such contractual penalty." (emphasis in bold mine)

This was the indemnity clause of their previous NDA:

"The Vendor shall indemnify XYZ for any loss or damage to XYZ as a result of the Vendor's breach of the obligations in this Agreement."

So, I'm thinking it might be time to seize, uh I mean cease collaboration and part ways with these guys. Obviously, I would never intentionally breach the agreement, but that is just far too high a potential price to pay if they somehow ever decide I have breached it in some way.
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IanDhu  Identity Verified
France
Local time: 12:28
Member (2005)
French to English


Posted via
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Avoid getting tied up in legal knots May 8

Don't sign an NDA carrying such a hefty contractual penalty: a client is entitled to be indemnified (compensated for harm), and to nothing more. Furthermore, clients who wind clause after opaque clause round their translators should be avoided. If anything looks unclear to you, don't sign. Likewise if you apprehend the implications of signing to such constrictive undertakings, don't enter into them.

If clients lay such obligations on translators, then logically, equally constraining
... See more
Don't sign an NDA carrying such a hefty contractual penalty: a client is entitled to be indemnified (compensated for harm), and to nothing more. Furthermore, clients who wind clause after opaque clause round their translators should be avoided. If anything looks unclear to you, don't sign. Likewise if you apprehend the implications of signing to such constrictive undertakings, don't enter into them.

If clients lay such obligations on translators, then logically, equally constraining obligations should be imposed on clients. Again, avoid one-sided covenants.

Best of luck, and I hope you find understanding clients in replacement.

With kind regards,

Adam Warren (IanDhu - translator 41189)
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DZiW
Rowan Morrell
Sheila Wilson
Julie Barber
Oleksandr Ivanov
Alexa Golova
 

IanDhu  Identity Verified
France
Local time: 12:28
Member (2005)
French to English


Posted via
ProZ.com Mobile


Clauses should be understood in conjunction May 8

Dan Lucas wrote:

The question is, which clause takes priority?



In a given instrument (here, an agreement), the clauses cannot logically be interpreted in isolation. It's best, though, not to sign if there is any uncertainty. One can propose a clearer drafting explicitly linking both the indemnity clause and the limitation of liability.

In that connection, I negotiated a more moderate wording with one client to cover quality claims concerning work that largely met the standard - a quantum meruit clause. The client bashfully acceded to my request.

Even so, colleagues should avoid covenanting to pointlessly, deviously complicated requirements of clients. Most colleagues are aware of certain work providers' impenetrable, catch-all formulations, that colleagues have documented as leaving their hapless signatories without a leg to stand on.

The important thing is to assure younger entrants that they don't need to tie themselves down in this way. Let's hope we can succeed in this.


Mirko Mainardi
 

Julie Barber  Identity Verified
United Kingdom
Local time: 11:28
Member (2006)
French to English
more examples Jun 27

I was a approached by an Irish agency to work for them and sent a contract/NDA that also included an indemnity clause; that if I breached any of my obligations (some obligations were the standard of work, so I presume a scenario could involved a mistake on my part):

"X Language Services will be entitled to recover from me ANY cost incurred by remedial action and attributable to X Language Services".

When I asked to discuss the clause and asked what they did from their s
... See more
I was a approached by an Irish agency to work for them and sent a contract/NDA that also included an indemnity clause; that if I breached any of my obligations (some obligations were the standard of work, so I presume a scenario could involved a mistake on my part):

"X Language Services will be entitled to recover from me ANY cost incurred by remedial action and attributable to X Language Services".

When I asked to discuss the clause and asked what they did from their side to limit the risk of problems - ie using proofreaders, having a time limit when a translation has been deemed to be "accepted", the contact abruptly ceased. I waited a week and asked if the PM could clarify so that I would be able to return the forms but got no answer.

I wouldn't work with an agency that can't explain its clauses anyway and I don't think that I will sign off any contracts with an indemnity clause future if I can avoid it. Of course I always do my best with my work and have never had any issues, but anybody can make a mistake. If a company is acting as an agent and reaping the financial benefits, then they should take up their liability like an agent as far as I am concerned.
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Sheila Wilson
Christine Andersen
 

Julie Barber  Identity Verified
United Kingdom
Local time: 11:28
Member (2006)
French to English
Be aware of where these clauses might be hidden Aug 5

I wanted to come back to this to say be aware of where these clauses might be hidden. I was asked to sign up with a UK agency who has a very good reputation on the Blueboard. I thought "great". When you fill in their brief and apparently easy online request for information there is a T&C's section to tick (just like with many internet-based providers, it is tempting not to bother reading....). I copied and pasted it into Word - a whopping 16 pages long!! So I did a search for the word "indemnity... See more
I wanted to come back to this to say be aware of where these clauses might be hidden. I was asked to sign up with a UK agency who has a very good reputation on the Blueboard. I thought "great". When you fill in their brief and apparently easy online request for information there is a T&C's section to tick (just like with many internet-based providers, it is tempting not to bother reading....). I copied and pasted it into Word - a whopping 16 pages long!! So I did a search for the word "indemnity" and there it was.....hidden away in a clause about intellectual property infringement.... but the clause was widened to include all cases of indemnity:

16.4 The Contractor agrees to indemnify the Company and keep it indemnified at all times against all or any costs, claims, damages or expenses incurred by the Company, or for which the Company may become liable, with respect to any intellectual property infringement claim or other claim relating to the Works or Inventions supplied by the Contractor of the Company during the course of providing the Services.

Never just tick innocent looking boxes!

I questioned it with the agency and they were good enough to respond (some don't):

"These are standard terms and have never been used.
However, in the case of quality disputes, where we are at fault and have to refund the customer, we will ask (not tell) you if you're happy to do so. All translators we've asked previously have agreed to do this, as it's in everyone's best interest.
Hope this helps clarify the intent behind that legal text."

I wouldn't expect to be paid if there were serious issues with quality, but I don't want to leave myself open to further claims and feel that if I signed, the contract not the explanation would apply! Any thoughts? thanks

[Edited at 2019-08-05 11:19 GMT]
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Christine Andersen
Yolanda Broad
 
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